New Delhi, Aug. 6 -- On 6 August 2025, the Reserve Bank of India's (RBI) policy-rate-setting Monetary Policy Committee (MPC) finally decided, in common with major central banks-of the US, UK, China and the EU- that discretion is the better part of valour.

In times of extreme uncertainty, as at present, it is better to mark time. Wait for the tariff-induced fog to clear and then proceed. Hence, its unanimous decision to maintain status quo on the policy rate (5.5%) and keep its monetary policy stance 'neutral.'

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This is welcome. Though the minutes of the last MPC meet in June had hinted as much-"After having reduced the policy repo rate by 100 bps in quick succe...